Nevada statutes have developed a corporate structure that is unique throughout the world. Nevada began with corporate statutes based on Delaware, and then went further, establishing a corporate structure that allows investors and owners of Nevada corporations to remain completely private. Since these changes in Nevada's statutes came into effect in 1991 the number of new incorporations in Nevada has exploded. Since it is corporate privacy that is at the heart of the matter, this issue is examined in the following section..
PRIVACY just might be the principal reason that there were over 40,000 incorporations in Nevada last year alone. It looks like more and more business-smart people are discovering the tremendous advantages that complete privacy offers! Unlike most other states, Nevada doesn't even want to know who owns the stock of a corporation. The information is simply not kept on file with the state. To ensure privacy, Nevada is the only state that allows its corporations to use bearer stock certificates. It is virtually impossible to prove the ownership of a Nevada corporation handled in this manner. Since the state does not require a corporation to list with it the corporation's vice-president(s), a vice-president can have complete control and ownership while remaining anonymous. The Supreme Court of Nevada has consistently taken a very strong stand to protect corporate privacy, even when a corporation fails to properly take care of basic corporate formalities (though we strongly recommend that every corporation do so).
*No State Tax*
Pro-business Nevada, unlike most every state in this country, has taken a stand! The state has continued to not tax the income of its corporations or its state's citizens. A Nevada corporation is also not subject to any other hidden taxes such as franchise taxes, capital stock taxes, or inventory taxes. Sales tax applies only to products sold within the state. Imagine a state that believes that taxation should not come directly off income from its citizens or businesses. This almost sounds like capitalism.
*15% Tax Rate*
Corporate federal tax payable is only 15% on the first $50,000 of net income.
*No Reciprocity With The IRS*
Because Nevada has no state tax, and because budget-conscious Nevada does not keep much information on their own residents or their corporations, it has steadfastly refused IRS requests for reciprocity. Other states freely exchange all of the information they have on every resident and corporation.
In this increasingly litigious society, it is becoming increasingly important to limit your exposure and protect any assets that you may have. Just cause is not a pre-requisite to lawsuits any more. On the other hand, the PRIVACY afforded by a Nevada corporation can make it virtually impossible for creditors and litigants to get at your hard-earned assets. One of the main reasons that a business owner will decide to incorporate is to limit the potential liability that his/her business has on personal assets. Incorporating separates those activities of the corporation from the assets of the individual. While this principle is valid in any state, the PRIVACY inherent in Nevada corporations takes it to a new level.
*Only One Person Required*
Unlike many other states, in Nevada only one person is required to form the corporation. A single individual can be named as the entire Board of Directors, and all of the Officers.
*Out-of-state Incorporators Are Welcome*
The state of Nevada does not require that any of the Directors or Officers be residents of the state. In fact, an out-of-state citizen can set up a Nevada corporation without ever being physically present in the state! In most other states, a Nevada based corporation can have an office and even effect sales through contractors without having to register to do business in the other state. *Low Cost* Because Nevada values its corporate business, it charges an annual filing fee of just $85. In comparison, annual fees in California, for instance, amount to $1150!
*Liability Protection Over Other States*
Most every state in the United States has adopted corporate statutes that limit the liability of any of its representatives which includes Officers, Directors and Stockholders. Nevada has gone one step further, very specifically spelling out in its statutes that all corporate representatives are free from personal liability from corporate activities except in cases where fraud has been perpetrated. This means that the corporation can be sued, file bankruptcy and be involved in other unfortunate activities and not jeopardize the personal assets of its agents or representatives. If a corporation does get sued, the initiator of the suit must bring action against the corporation in its state of domicile. This is where is becomes important to have your corporation set up in a state such as Nevada, that has taken a stand to protect the personal liability of a corporation's participants.
Many creative estate planning strategies have been developed to utilize Nevada corporations. Estate plans where trusts have traditionally been used can often be restructured more effectively using Nevada corporations. Nevada corporations are generally more flexible and creative when passing estates to heirs than trusts are, while providing similar benefits such as avoiding probate, and potentially eliminating all estate taxes. Remember, a corporation never dies, it just gets a new President!
*Nevada VS. "Offshore"*
Nevada is unique in that it not only offers a high degree of privacy, but ready access to your capital that is not likely to be denied in even the most extreme turmoil that COULD develop in the world's financial markets. In these highly uncertain economic times, long range planning should take into consideration the possibility, even the probability, of extreme turmoil. In that event, there could be some real shock felt by those whose strategies are oriented around offshore structures. It is entirely possible that, in a real emergency, offshore funds would be totally inaccessible, depriving the owners of those assets the use of their own capital when they need it the most. For any situation where ready access to one's capital is required, and especially if you wish to work with your capital, Nevada corporations are THE answer.
Nevada has minimal reporting and disclosure requirements. Stockholders, directors and officers need not live or hold meetings in Nevada, or even be U.S. citizens. Directors need not be stockholders. A Nevada corporation may purchase, hold, sell or transfer shares of its own stock. Nevada corporations may issue stock for capital, services, personal property or real estate, including leases and options. The directors may determine the value of any of these transactions, and their decision is final.
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Xtreme Business Solutions, Inc.
P.O. Box 50729
Henderson, Nevada 89016
(702) 616-1929 - Telephone
(702) 616-9787 - fax
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